[step:Set up the inductive step by decomposing $K$ along a maximal simplex]
Suppose now $N(K) > 1$ and that the theorem holds for every simplicial complex with strictly fewer simplices. Fix a simplex $\sigma \in K$ of maximal dimension among all simplices of $K$ (so no simplex of $K$ strictly contains $\sigma$). Define
\begin{align*}
S &:= \overline{\sigma} = \{\tau : \tau \text{ is a face of } \sigma\}, \\
L &:= K \setminus \{\sigma\}, \\
T &:= L \cap S = \partial\sigma = \{\tau : \tau \text{ is a proper face of } \sigma\}.
\end{align*}
We check these are simplicial complexes and that $K = L \cup S$. The face-closure axiom for $K$ ensures that every face of $\sigma$ is in $K$, so $S \subseteq K$ and $S$ is a simplicial complex. The removal of the single top simplex $\sigma$ leaves the face-closure condition intact on $L = K \setminus \{\sigma\}$, because no other simplex of $K$ has $\sigma$ as a face (maximality of $\sigma$ in $K$). Hence $L$ is a simplicial complex. Clearly $L \cup S = K$ and $L \cap S = \partial \sigma = T$, a simplicial complex.
Moreover $N(S) = \dim \sigma + 1 \cdots$ — more precisely, $N(S) = 2^{\dim \sigma + 1}$ counting all non-empty faces plus $\varnothing$ if included; in any case, $S \ne K$ forces $N(S) < N(K)$, and similarly $N(L) = N(K) - 1 < N(K)$, $N(T) < N(S) \le N(K)$. So the inductive hypothesis applies to $S$, $L$, and $T$.
Passing to barycentric subdivisions and writing $S', L', T'$ for the subdivisions of $S, L, T$: the construction of $K'$ is natural in the sense that the subdivision of a subcomplex is the subcomplex of simplices of $K'$ corresponding to flags entirely in the subcomplex. Explicitly,
\begin{align*}
S' = (\overline{\sigma})' \subseteq K', \qquad L' = (K \setminus \{\sigma\})' \subseteq K', \qquad T' = (\partial\sigma)' = S' \cap L',
\end{align*}
and $K' = S' \cup L'$. The simplicial approximation $a: K' \to K$ restricts to simplicial approximations (to the respective identities) $a: S' \to S$, $a: L' \to L$, $a: T' \to T$: for any vertex $\hat{\tau}$ of $T' \subseteq L' \subseteq K'$, the value $a(\hat{\tau})$ is a vertex of $\tau \in T \subseteq L \subseteq K$, so $a(\hat{\tau}) \in T$, and the restricted vertex map is again of the form described in [Simplicial Approximations to the Identity](/theorems/1935). Hence by that theorem, the restrictions are simplicial approximations to the identity.
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